A British Virgin Islands court has given Chinese investors Zhongshan permission to take £20 million ($25 million) from Nigeria’s foreign-denominated assets because of a failed Ogun trade zone deal that occurred in the early 2000s, when then-Governor Ibikunle Amosun was in office.
The British Virgin Islands High Court’s Justice Paul Webster decided on November 8 that Nigeria could not argue that it was immune from the enforcement of an arbitral ruling that favoured Zhongshan.
The bilateral investment treaty between China and Nigeria, which contained a provision requiring both countries to enforce arbitration rulings, served as the foundation for the ruling.
According to People’s Gazette, the judge interpreted this clause as Nigeria’s written consent to enforcement under the treaty, thus enabling Zhongshan to pursue judgment debt collection.
Justice Webster cited Section 13(3) of the State Immunity Act 1978, mandating the British Virgin Islands to permit Zhongshan to recover the debt from Nigeria’s assets in the UK.
This ruling is only one of many legal defeats Nigeria has had globally. Nigeria’s claims of national immunity have also been rejected by courts in France, Belgium, Canada, the US, and other countries, repeatedly siding with Zhongshan.
Zhongshan’s legal team, headed by Lauren Peaty of Withers British Virgin Islands and King’s Counsel Timothy Otty, asserted that Amosun’s government arbitrarily ended the Ogun trade zone agreement.
They sought justice in foreign courts after alleging that the former governor ordered the detention and torture of their representatives.
In a bid to enforce a $70 million arbitral award, Zhongshan targeted Nigeria’s dollar-denominated crude earnings held in JP Morgan accounts in the United States.
While U.S. courts rejected Nigeria’s sovereign immunity claims, the matter is now pending before the U.S. Supreme Court, following Nigeria’s November 7 filing for a writ of certiorari. Until the Supreme Court makes a decision, Zhongshan’s access to these funds remains delayed.
Meanwhile, the Chinese investors have begun seizing Nigeria’s overseas assets, including two guest houses in Liverpool and aircraft in France and Canada, to recover the debt.
The contentious contract’s signer, Mr. Amosun, has come under fire from the public for his part in the scandal. He acknowledged in August that he had not checked Zhongshan’s statements before signing the contract, describing them as untrue.
